Question

When the LIFO method of inventory valuation is used, Cost of Goods Sold is assumed to consist of: Select one O a. The least expensive units O b. The most expensive units Oc. The most recently purchased units Od. The oldest units 40.Failure to record the 12/31 adjusting entry to accrue expenses: Oa. Understates Liabilities Ob. Overstates Revenue Oc. Overstates Expenses Od. Understates Assets Oe Understates Net Income Finch attempt

Answer 1

When the LIFO method of inventory valuation is used, Cost of Goods Sold is assumed to consist of the most recently purchased units. Therefore, option c. "The most recently purchased units" is the correct answer.

Regarding the second question, failure to record the 12/31 adjusting entry to accrue expenses results in overstatement of net income and overstatement of assets. Therefore, option Oe "Understates Net Income" is the correct answer, and option Oa "Understates Liabilities" and Od "Understates Assets" are incorrect. Option Ob "Overstates Revenue" and Oc "Overstates Expenses" are not directly related to the failure to record the adjusting entry, so they are also incorrect.

Step-by-step explanation: